EAST WINDSOR, NJ -- (MARKET WIRE) -- June 26, 2006 -- NexMed, Inc. (NASDAQ: NEXM), a developer
of innovative pharmaceutical products based on its proprietary, NexACT®
transdermal drug delivery technology, announced today that Schering AG has
terminated its license, supply and distribution agreement for Alprox-TD®,
NexMed's topical treatment for erectile dysfunction (ED), currently in
clinical development. It is NexMed's belief that Alprox-TD is no longer a
strategic fit for Schering.

The agreement, signed in July 2004, provided Schering AG with exclusive
commercialization rights to Alprox-TD in Europe, Russia, the Middle East,
South Africa, Australia and New Zealand. NexMed has not received any
milestone payments under the agreement. However, pursuant to the terms of
the agreement, Schering is now obligated to pay NexMed a termination fee in
the amount of EUR 500,000.

Commenting on today's news, Richard J. Berman, NexMed's Chief Executive
Officer, said, "While we regret losing Schering as an overseas marketing
partner for Alprox-TD, we are pleased to have back in our possession these
valuable licensing and marketing rights. We will use this opportunity to
redouble our efforts to license Alprox-TD to a co-development partner who
will commit financial resources to the completion of the clinical
development program required for approval in Europe and the U.S. We have
already commenced discussions with a number of potential partners."

Mr. Berman noted that, to date, NexMed has completed two U.S. Phase 3
pivotal clinical studies for Alprox-TD, involving over 1,700 patients,
which showed statistically significant efficacy (p < 0.001) across all
degrees of ED and co-morbidities. Moreover, Alprox-TD, which incorporates
the active ingredient, alprostadil, has shown an excellent safety profile
in clinical studies conducted to-date, with no serious side effects
reported.

It is estimated that between 15 and 30 million U.S. men suffer from ED,
with only a small percentage of men seeking treatment. The worldwide market
for ED is projected to reach $4.3 billion by 2010. NexMed's Alprox-TD is
suited for patients who are unresponsive to currently available PDE-5
inhibitors or are on medications that are contraindicated for PDE-5
inhibitors, as well as men with diabetes or those who have undergone
prostatectomies.

Mr. Berman continued, "We remain enthusiastic about the future prospects
for NexMed. Our current cash position should give us a solid financial
cushion for the next 15 months. Our exclusive global licensing agreement
for our proprietary NM100060 nail lacquer treatment for onychomycosis (nail
fungus) could also provide NexMed with up to $47 million in milestone
payments over the next two years in addition to the upfront payment of $4
million which we received upon signing the deal. Beyond that, we will also
receive royalties based on sales."

NexMed is also developing Femprox, a topical treatment for female sexual
arousal disorder which is currently in Phase 2 in the U.S., and NM100061, a
proprietary early ejaculation ("EE") treatment under development. EE,
commonly known as premature ejaculation, is the most prevalent male sexual
dysfunction, affecting as many as one-third of men worldwide at some time
in their lives. NexMed is pursuing co-development partners for all of its
products under development.

Conference Call

NexMed management will host a conference call today, June 26, 2006 at 10:00
a.m. EST. The call can be accessed in the U.S. by dialing 877-407-9205 and
outside of the U.S. by dialing 201-689-8055, and asking the conference
operator for the NexMed Conference Call. The teleconference replay is
available for one week by dialing in the U.S. 877-660-6853 and outside of
the U.S. by dialing 201-612-7415. Replay pass codes 286 and 206862 are
both required for playback. The conference call will also be Webcast live
at URL http://www.vcall.com/IC/CEPage.asp?ID=106340.

About NexMed, Inc.

NexMed, an innovative drug developer, offers large pharmaceutical companies
the opportunity to develop new patient-friendly transdermal products, and
extend patent lifespans and brand equity, through participation in early
stage licensing and development partnerships. NexMed currently has a host
of medicines in development, such as treatments for nail fungus, sexual
disorders and more, all based on its proprietary NexACT drug delivery
technology.

Statements under the Private Securities Litigation Reform Act: with the
exception of the historical information contained in this release, the
matters described herein contain forward-looking statements that involve
risk and uncertainties that may individually or mutually impact the matters
herein described, including but not limited to the extent and timing of
anticipated milestone payments, the initiation and completion of clinical
trials, the dependence on compliance with FDA and other government
regulations, the ability to enter into partnering agreements, raise
financing on acceptable terms, pursue growth opportunities, effectively
reduce expenses and/or other factors, some of which are outside the control
of the Company.